Thread: Pioneering investor Sir John Templeton, Winchester native, dies at 95

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In 1956 Templeton joined with marketing consultant William Damroth to launch Nucleonics, Chemistry and Electronics Fund, a specialty fund that reflected Templeton's lifelong interest in science and technology. With investor interest in specialty funds rising in the late 1950s, Templeton Damroth's new fund grew dramatically. Hoping to raise capital to finance more growth, Templeton then made a bold move to accelerate his company's growth.

In this era, mutual fund management companies rarely became public corporations. As a result, they were denied access to the public markets to raise capital to grow. A series of court decisions during the late 1950s, however, had clarified the provisions of the Investment Company Act of 1940 and upheld the right of fund management companies to "go public”. With five funds under management and total net investments of over $66 million in 1959, John Templeton seized the opportunity to raise capital, and Templeton Damroth joined a sudden surge of fund firms that went public at this time.

Templeton sold his stake in Templeton Damroth in 1962 and over the next three decades created some of the world’s largest and most successful international investment funds. Each $10,000 invested in the Templeton Growth Fund Class A in 1954, with dividends reinvested, would have grown to $2 million by 1992 when Sir John sold the Templeton Growth Fund. This translates into an annualized return of 14.5% since inception.

During a career that included directorships on banks, businesses, and insurance companies, Templeton maintained a long association with the Presbyterian Church (U.S.A.). He was a trustee on the board of Princeton Theological Seminary, the largest Presbyterian seminary, for 42 years and served as its chair for 12 years. He also lent his business acumen to the Presbyterians' ministerial pension fund for more than three decades until 1993.

Templeton was known for starting his mutual fund’s annual meetings with a prayer. He explained that the devotional words were not pleas for financial gain in the mundane world, but rather meditations to calm and clear the minds of managers and stockholders. Templeton often told interviewers that "competitive business," in his view, matched in many ways the compassionate aims of religious bodies. "For one thing, it enriches the poor more than any other system humanity ever has had," he once told Insight magazine. "Competitive business has reduced costs, has increased variety, has improved quality." And if a business is not ethical, he added, "it will fail, perhaps not right away, but eventually."

Although he was a Presbyterian elder active in his denomination and served on the board of the American Bible Society, Templeton espoused what he called a "humble approach" to theology. Declaring that relatively little is known about God through scripture and present-day theology, he once predicted that "scientific revelations may be a gold mine for revitalizing religion in the 21st century."

Templeton took a broad view of spirituality and ethics. He was influenced by the Unity School of Christianity, a movement that espouses a non-literal view of heaven and hell and a shared divinity between God and humanity. As he wrote, "We realize that our own divinity arises from something more than merely being 'God's children' or being 'made in his image.'" Templeton did not claim to be a theologian, but he was determined to support the work of those who might deepen our "knowledge and love of God."

The annual Templeton Prize grew out of the philanthropist's belief that an honor equivalent to a Nobel Prize should be bestowed on living innovators in spiritual action and thought. Mother Teresa of Calcutta was the first Templeton Prize Laureate in 1973, followed later that decade by the evangelist Billy Graham and the writer Aleksandr Solzhenitsyn. In recent years, the Prize has been awarded primarily to physicists, cosmologists, and philosophers, including Freeman Dyson, Paul Davies, Ian Barbour, John Polkinghorne, George Ellis, Charles Townes, John Barrow, Charles Taylor, and Michael Heller. Representatives of all of the world’s major religions have been on the panel of nine judges throughout the prize’s history, and recipients have included Christians, Jews, Muslims, Buddhists, and Hindus.

John M. Templeton was born Nov. 29, 1912, in the small town of Winchester, Tennessee. Though forced to support himself while studying at Yale University during the Depression, he graduated in 1934 near the top of his class. He was named a Rhodes Scholar to Balliol College at Oxford, from which he graduated with an M.A. degree in law. He married the former Judith Folk in 1937, and the couple had three children – John, Anne and Christopher. She died in February 1951. He married Irene Reynolds Butler seven years later on New Year's Eve 1958. She passed away in 1993 after 35 years of marriage.

John Templeton is survived by his son John M. Templeton, Jr., known as Jack, who retired as a pediatric surgeon in 1995 to become president of the John Templeton Foundation, his son Christopher, stepdaughter Wendy Brooks, three grandchildren and three great-grandchildren. His daughter, Anne Templeton Zimmerman, died in 2005 and his stepson, Malcolm Butler, died in 1995.

Patience still key in bear markets

* Nils Pratley
* The Guardian,
* Wednesday July 9, 2008

Buy when there is blood on the streets, advised Sir John Templeton, the celebrated investor and philanthropist whose death at the age of 95 was announced yesterday. It is excellent advice, as Templeton proved time and again, and a few market shrewdies are asking whether current conditions are sufficiently bloody to be tempting.

Bad news arrives daily. Choose your own lowlight: the Marks & Spencer profits warning; the frantic attempts to refinance Bradford & Bingley; the desperate plight of the housebuilders, now cutting jobs by the thousand; the collapse in advertising revenues reported by Trinity Mirror; and the warning yesterday from Savills that the credit squeeze is now hitting property markets in continental Europe and Asia.

The bigger picture is equally gloomy. Business confidence, house prices and retail sales are falling. Even the UK manufacturing sector - the last bright spark in the economy - has turned downwards. And now the US Federal Reserve tells us that emergency lending facilities for Wall Street investment banks will remain open until 2009. A few might regard the Fed's action as good news (Wall Street was undecided yesterday), but the real message is surely that the financial emergency isn't over.

Those looking for light at the end of the tunnel have to squint very hard indeed. Their best idea is that the commodities boom may be about to end. You can see it in the miners' share prices: Rio Tinto, for example, was down 5.6% yesterday and is now 23% below its peak. Bad news for Rio, but maybe better news for everybody else if the implication is that the price of raw materials is set to fall.

That might relieve inflationary pressures, and so allow central banks to deliver the cuts in interest rates that the UK economy, in particular, would seem to need to avoid recession.

The problem with this call is that it feels terribly early. The price of oil may have fallen in the past few days but, at $138 (£70) a barrel, it is still blowing inflation through the global economy. A return to $100 seems a reasonable punt - after all, the price is now affecting demand - but it hasn't happened yet. Even if it does, it will take time to feed into the inflation numbers.

In the meantime, a lot can happen. It is too easy to imagine another round of write-downs and bad debts at the banks. Where are the credit card defaults? Hardly anybody has mentioned them, but they must be coming. The decline in property prices looks only to have begun. Will it be 10% in the UK or 20%, or even 30%?

It's encouraging that market analysts at Morgan Stanley can publish a piece called "the big snapback may not be far away". Closer inspection, however, reveals they are talking about rotation between sectors, not the market itself. Their model on market timing - which has had a splendid record over the past year - is not yet signalling a buying opportunity. Patience, as they say, remains key in bear markets.

1913 thesis

Could today's annual meeting of the London Stock Exchange be the last one at which the chief executive, Dame Clara Furse, can boast a market share of more than 50% of the shares traded in London?

A look at the LSE's own share price suggests a few people think the answer is "yes". From almost £20 at the turn of the year, the LSE stands at 671p. Bear markets are terrible for stock exchanges - flotations dry up and the value of the shares being traded falls - but a decline in value of two-thirds in six months suggests a serious loss of confidence.

This is strange in one sense. There has been plenty of time to assess the LSE's chances of retaining its current slice of the pie - about 70%. The arrival of competition has hardly been a secret. The fact that Turquoise, the venture backed by the big investment banks, is within a month or two of its launch should not have induced panic. The rival Chi-X platform is up and running and the LSE's volumes haven't gone into freefall.

Yet the revolutionaries will talk. At a presentation yesterday, Simon Brickles of Plus Markets, who has been sniping away at the LSE for years in small and mid-sized stocks, compared Europe's incumbent stock exchanges with Europe's royal families in 1913. They thought their privileged world would never change, and then it did.

The next year will reveal whether the 1913 thesis is correct. For Furse, the stakes could not be higher. Her critics say she should have sold the LSE when she could; that strategic partnerships overseas should have been struck; that the merger with Borsa Italiana was a sideshow. But the coming scrap in her backyard is the big one. The share price looks wrong - but which way?

You want a guess? Don't write off Clara yet. The revolution will take time.

This article appeared in the Guardian on Wednesday July 09 2008 on p25 of the Financial section. It was last updated at 00:05 on July 09 2008.